4 Strategic Tools Service Businesses Can Borrow From Their Retail Counterparts

Over the past decade, ecommerce has enjoyed explosive growth. Retailers everywhere, large and small, have their pick from a range of tools to create an online shopping presence that attracts customers and increases revenue.

But for today’s hair salons, spas, car repair shops, and other service- or appointment-based businesses, the technology needed to enhance the customer experience requires a slightly different set of features.

The good news: Much of the technology designed for retail has finally caught up with the service industry, ushering in a new category of tools that can free up much needed time for business owners.

Here are four ways that service merchants can adapt the ecommerce model to fit their specific needs:

1. Integrate data to deliver a personalized customer experience

When we shop online, retailers track our browsing history and preferences to serve up personalized recommendations based on what we’ve browsed, clicked on, and bought in the past. Then, they can automatically load up prior payment details for quick and easy checkout.

Why should booking an appointment for a blowout or oil change be any different? Service-based businesses can keep pace by using online tools that harness customer information like past purchases, preferences, and payment information. Using personalized data to guide all aspects of customer outreach and interaction improves customer experience, which in turn helps grow revenue.

Examples might include “remembering” a customer’s favorite stylist when they go online to book an appointment, putting their most recent services purchased at the top of the page for quick selection, or making recommendations for relevant products or services.

This treasure trove of customer insights also makes way for a new era of marketing and promotions to further enhance the customer experience by offering customers products and services that they actually want and need. We’re well beyond the one-size-fits-all approach that mass email blasts and coupons bring to the table.

Data can add a smart layer to a vendor’s communications with its customers, making it possible to send personalized offers to the right people, at the right time. Picture a spa that can push out an email to a specific customer when their favorite therapist becomes available at their most requested day and time. That personalization can go a long way in filling empty appointments—driving revenues while simultaneously boosting customer loyalty. It’s truly a win-win.

2. Use positive reviews to your advantage

Checking out online reviews of businesses has become commonplace. From logging onto a crowd-sourced review site or a company’s website to find feedback about clothing or electronics, or leaving reviews for other customers to reference when making a purchase decision—everyone is turning to reviews. In fact, only five percent of consumers say they’ve never looked up a local business’ online review. For local businesses, this feedback can make or break the foot traffic that comes through the door.

Yelp, Angie’s List, and similar sites have been helping consumers identify the best local services for their needs for many years, so service-based businesses may actually be a bit ahead in this category. They also have the added edge of being able to ensure a smooth customer experience in-person.

Where they can learn from the ecommerce approach is using those reviews to their advantage by proactively collecting and promoting them. Business management tools can automate the process of incentivizing and managing customer referrals to more quickly turn existing customers into loyal ambassadors. Even the ability to proudly display positive reviews on a business’s website can now be achieved with a simple widget to more easily attract new and return business.

But what about the negative news? It’s critical for businesses to pay attention to less-than-stellar feedback captured from customers. Business management and customer engagement software can help catch these comments early, giving the business the opportunity to proactively address issues immediately after customers post negative reviews online.

3. Reward loyal customers

Online shoppers know that loyalty is rewarded, often in the form of special discounts, points that can be put toward purchases, and more. What ecommerce providers understand, and service-based businesses can learn, is that a rewards program is more than just creating happy customers—it’s also a cost-savvy marketing tool.

For example, LunchboxWax Salon, a premier salon dedicated entirely to waxing, keeps customers coming back with a points program that offers cash discounts on products. For every 100 points earned, customers receive a $1 discount, without the hassle of having to enroll in a special program or keep track of points.

Studies show that it costs a business five times as much to attract a new customer than to keep an existing one. All businesses should prioritize retention over acquisition. Engaging consumers through a loyalty program is an effective marketing channel that keeps them happy and coming back for more.

Consumers have countless options. Now more than ever, they need a reason to consolidate their purchases with a particular business instead of buying items from various sources. A loyalty program, paired with excellent service from technicians they know and trust, can tip the scales. Or perhaps offering a special package or membership program that provides a discount in exchange for purchasing a series of ongoing services will help “lock in” future revenues.

The concept of receiving extra value for everyday purchases can also counteract consumers’ obsession with discounts and coupons that often leads them elsewhere. New tools can support and automate the process of reminding customers about their preferred services and deliver unique discount codes customized to their purchase history to lure them back again.

4. Create an optimized online presence

Consumers can shop on Amazon at all hours of the night—shouldn’t they be able to shop for their next hair appointment or oil change the same way? Nearly 40 percent of appointment bookings happen after hours, and many who are booking appoints during the day also prefer to avoid having to make a call.

Adding online scheduling capabilities can be a tremendous advantage because they make it possible to capture appointments at any time of day. The simple addition of a “book now” button on the home page can have a major impact on revenue. In fact, by implementing this easy feature, Shen Tao Studio in New York City saw a 109 percent increase in monthly bookings, which resulted in a 250 percent increase in monthly revenue.

According to ADP historical data, 91 percent of new jobs added within the small business sector over the last two years were in the services industry, at non-franchise businesses like salons, spas, and auto repair shops. With this much growth in store, it’s time for service businesses to step up their game.

With a few tweaks to the tried-and-true tools that have been working for ecommerce for years, they can deliver a seamless, technology-driven experience that drives revenue and keeps customers coming back for more.

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Josh McCarter is business leader with a track record of scaling entrepreneurial technology businesses. He co-founded Booker in 2010 and has served as the company's CEO since it was spun out of SpaFinder, its original parent company. Josh is focused on expanding Booker’s reach through partnerships and client relationships while creating a culture of innovation and excellence in Booker’s offices around the world. Prior to Booker, Josh was President and COO of Arbitech, a leading independent distributor of computer hardware that achieved $1B of sales under his leadership.